Hammer Candlestick Pattern
A small body with a long lower wick after a decline — a classic potential bullish reversal clue.
A Hammer is a single candle with a small real body near the top of its range and a long lower wick, appearing after a downtrend. It shows that sellers pushed price sharply lower during the period, but buyers stepped in and dragged the close back up near the open. That rejection of lower prices is why the Hammer is watched as a potential bullish reversal signal — especially when it forms at a support area and is confirmed by a strong candle afterwards.
How to recognise it
- Small real body near the top of the candle range.
- Lower wick is usually at least twice the body height.
- Upper wick is small or absent.
- Most relevant after a downtrend or near support.
The psychology behind it
Sellers pushed price sharply lower, but buyers absorbed the pressure and forced a close near the highs. That visible rejection of lower prices can suggest fresh demand is appearing.
Frequently asked questions
What is a Hammer candlestick pattern?
A Hammer has a small body near the top and a long lower wick, showing that sellers pushed price down but buyers reclaimed most of the move. After a downtrend it is read as a potential bullish reversal signal, best confirmed by the next candle.
Is the Hammer a reliable reversal signal?
It is a clue, not a guarantee. A Hammer at a support zone with a confirming up-candle afterwards carries more weight, while a Hammer in the middle of a strong downtrend is often absorbed. Always judge it with trend and level context.
What is the difference between a Hammer and a Hanging Man?
They look identical, but location changes the meaning. A Hammer forms after a decline and hints at a bullish reversal; a Hanging Man forms after a rise and warns of possible weakness.
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Last reviewed: September 2026 · CandleIQ Learn